USD/CHF trades with negative bias above 0.8100; focus remains on US CPI report

• USD/CHF edges lower on Tuesday amid the lack of follow-through USD buying.
• Rising Fed rate cut bets hold back the USD bulls from placing aggressive bets.
• Traders now look to the crucial US consumer inflation data for a fresh impetus.

The USD/CHF pair attracts some sellers during the Asian session on Tuesday and erodes a part of the previous day's strong move higher to over a one-week top. Spot prices, however, manage to hold above the 0.8100 mark amid mixed fundamental cues, warranting some caution for aggressive bearish traders.

The US Dollar (USD) struggles to build on its gains registered over the past two days amid expectations that the Federal Reserve (Fed) will resume its rate-cutting cycle in September, and acts as a headwind for the USD/CHF pair. Moreover, traders are pricing in the possibility of at least two 25-basis-point Fed rate cuts by the year-end. The bets were lifted by the disappointing US macro data released recently, including the Nonfarm Payrolls report, which signaled that the economy could be weakening.

Meanwhile, persistent trade-related uncertainties might hold back traders from placing aggressive bullish bets around the Swiss Franc (CHF) and help limit deeper losses for the USD/CHF pair. In fact, Switzerland faces a crippling 39% tariff on its exports to the US. Moreover, sources familiar with the matter said that US officials rejected Swiss President Karin Keller-Sutter's demand for a tariff rate of 10%. Apart from this, the underlying bullish sentiment might cap the upside for the safe-haven CHF.

Traders might also refrain from placing aggressive directional bets around the USD/CHF pair and opt to wait for the release of the latest US consumer inflation figures, due later during the North American session. The crucial US Consumer Price Index (CPI) report will be looked upon for fresh cues about the Fed's rate-cut path, which, in turn, should drive the USD demand in the near term. Apart from this, speeches from influential FOMC members should provide some meaningful impetus to the pair.